05/23/2020
Wow! There are a lot of accusations, assumptions and contentions in this article, and I have not read the filed complaint, but, I think a bit more explanation or another perspective may be of value to some folks.
Although it is true, listing brokers must offer compensation to the buying broker. That is non-negotiable, to keep it equal and fair to all brokers. The article neglects to point out that the buyer’s broker can do what they want with their commission. They could give a portion or all of it if they choose, to the buyer. Most don’t do that. Some of us do. I do.
“rigged system” ? Not so much. It is a workable system; some brokers charge higher listing commission fees, and some charge lower fees. It is important for sellers to do their research and find the right service at the right price. I am not sure what other countries fee have to do with American fees.
True, the commission offer is posted on the MLS listing, and it is a broker and/or agent that withholds or shares that fee amount. I always share whatever could be important to my client.
Buyer- brokers that work unethically will only show higher commission listings- they worry about their needs over their client’s needs- this is SO wrong. But, it is not steering. In the typical sense.
Steering is when an agent decides which neighborhood or area the client should buy- based race, color, religion, gender, disability, familial status, or national origin. But an agent choosing a home to show based on his or her commission is unethical. Nothing more. But not really steering in the legal sense.
I believe many people can’t explain how their realtor got paid. Sometimes an agent does not explain it clearly; sometime people don’t care, listen, or learn. However, they should have a written agreement that requires signatures of acknowledgement, describing precisely how and when money changes hands.
It is true buyer’s do not need to pay their broker directly. And, some agents will represent their services as free, and advertise it that way. That part is wrong. They are trying reach new customers.
Years ago I realized that buyer is really paying the real estate fees- in his mortgage payment.
The problem for many buyers is having enough cash to purchase the home. If they also have to pay a realtor fee prior to or at closing they just couldn’t buy the home. So at a closing, when the title changes hands- who has the money? Yup – the seller.
It started with, if the seller would give cash to the buyer to make his transaction work- the buyer agrees to pay a higher price for the home. Seller still gets what was wanted. And buyer gets their home. The buyer pays for it in the long run. Essentially, the system is working, the way it should. Not perfect. But it works.
Are real estate fees too high? I have thought so for years. So I chose many years ago to offer a reduced fee-full service listing, and also give buyers money from my commission at closing.
“It's a rigged system ultimately,” said Marisa Katz, an attorney for lead plaintiff Christopher Moerhl, of Shorewood, MN.
